U.S. futures sharply lower amid Fed fears; Dow Jones down 0.68%

U.S. stock futures pointed to a sharply lower open on Thursday, one day after Federal Reserve Chairman Ben Bernanke said the bank could begin tapering its bond-buying program. 

Ahead of the open, the Dow Jones Industrial Average futures pointed to a 0.68% decline, S&P 500 futures signaled a 0.82% slump, while the Nasdaq 100 futures indicated a 0.84% drop.

In testimony to the U.S. Joint Economic Committee on Wednesday, Bernanke said a decision to scale back the Fed’s asset purchase program could be taken in the "next few meetings" depending on economic data.

Stocks strengthened earlier Wednesday after Bernanke said in prepared remarks that a premature tightening of monetary policy carried substantial risks to the economic recovery.

Meanwhile, Wednesday’s minutes from the U.S. central bank’s May meeting showed a "number" of policymakers were prepared to taper bonds purchases as soon as June.

Financial stocks were expected to be active, after a broad decline in European lenders. In pre-market trade, JP Morgan tumbled 1.83%, while Bank of America shares plunged 2.78%. 

Tech stocks were also likely to be in focus, as Hewlett-Packard said earnings excluding some items will be in the range of 84 cents to 87 cents a share in the three months through July, above analysts' estimates. 

The news sent the maker of personal computers's shares soaring 11.63% in early trading. 

Among retailers, PetSmart rallied 2.37% in extended trading, after the retailer said late Wednesday that it predicted higher full-year earnings than initially forecast in March. 

Elsewhere, Bristol-Myers Squibb added 0.32% pre-market after a Citigroup note highlighted excitement surrounding so-called immunotherapy, in the wake of positive results from clinical trials conducted by companies such as Bristol-Myers and Roche Holding. 

Other stocks in focus included Gap, Salesforce.com, Williams-Sonoma, Zumiez, Pandora and Aeropostale, all scheduled to report first-quarter earnings later in the day. 

Across the Atlantic, European stock markets were sharply lower. The EURO STOXX 50 plummeted 2.31%, France’s CAC 40 retreated 2.30%, Germany's DAX plunged 2.64%, while Britain's FTSE 100 tumbled 1.61%. 

During the Asian trading session, Hong Kong's Hang Seng Index plummeted 2.54%, while Japan’s Nikkei 225 Index dove 7.32%. 

Also Thursday, the preliminary reading of China’s HSBC manufacturing purchasing managers' index fell to 49.6 in May, below the 50 level that separates contraction from growth down from a final reading of 50.4 in April. 

Later in the day, the U.S. was to release the weekly government report on initial jobless claims and official data on new home sales.